Pre-X Clause In Disability Plans

[PhilB]

I'm trying to research the prevalence of Pre-X clauses in Disability plans. Those of you who are consultants, can you shed any light on current trends? Any replies appreciated!

[oriecat]

Can't shed light on trends, but if it helps... We started offering voluntary disability in Dec 02, and the plan included a one year pre-x.

[GBurns]

I would say that all individual plans have pre-xs whereas group plans very rarely have them and when they do it is very limited (usually by negotiation with the employer).

I have not seen or heard of any trend that is changing this long established practice.

[Guest JPotosky]

I disagree with the prior post. Most individual plans medically underwrite on an individual basis. They will either approve completely or put an exclusion rider that is permanent. However most of the policies that are issued are done so without a rider.

My experience is that allmost all group plans have some kind of pre-existing condition clause. The clauses for groups that are small are fairly onerous (24 months -- some even have a rolling provision that guarantees an employee will never get past the exclusion).

Groups with 10 or more employees will generally have a 3/3/12 exclusion clause. This means that any medical issue that the employee is aware of or reasonably should have been aware about, or got treatment for during the immediate three months before the plan started will be exluded. However if the employee is treatment free for three months or on the plan for more than one year, the exclusion will be lifted.

There is a possiblity that some very large employers have disability plans that have no exclusion clause, but that is not the rule.